LAS VEGAS (KSNV) – Police say a massive scam has thrown into question the legality of most Las Vegas home foreclosures made in the past few years. The fallout from the scam may reveal that many people living in foreclosed homes may, unknowingly, not actually own the home.
“If someone's home was foreclosed on using improper documents, it calls into question the validity or legality of the foreclosure itself,” said John Kelleher, Chief Deputy Attorney General for Nevada’s fraud unit. “The fraud may call into question the purchaser title rights and it could cloud their title as well.”
The scam involves Gary Randall Trafford and Geraldine Ann Sheppard, two title officers who allegedly advised employees to forge signatures on default notices. The fraud resulted in the illegal filing of foreclosure documents for tens of thousands of Nevada homes. A single notary public -- one of many used in the scam -- came forward and admitted to notarizing around 25,000 fraudulent documents.
Banks would hire Trafford and Sheppard to prepare and file the paperwork needed to begin a foreclosure. The forged documents produced by the two took on the full legal effect.
Police say Trafford and Sheppard, who face over 600 charges listed in a 439-page indictment, are living in California. Warrants have been issued for their arrests, and an active search for the couple is underway. The charges listed are for fraudulent foreclosure documents the two had signed from 2005 to 2008.
Attorney General Catherine Cortez Masto says Trafford and Sheppard face more than 200 felony charges of offering a false instrument and false certification of an instrument, and more than 100 misdemeanor notarization charges.
As a result of the scam, many Vegas residents may be living in homes they do not actually own.
“I would suggest you review your documents and bring them to an expert and an attorney.” Kelleher said.
Kevin Savage, a senior loan officer with Evergreen Home Loans, said now is a good time for those who recently bought homes to review their homeowner’s title insurance policy, which is usually a part of closing costs, and usually covers scams.
“The one piece of paper they want to look at is the title policy,” Savage said. “They want to see how much coverage they have. More than likely, they’ve got way more than the value of the home.”
Any who think they have been scammed as a result of the fraud are advised to contact the Attorney General’s office, or simply contact an attorney.
